Electronic Arts: Information from Answers.com

Company Bio

Electronic Arts (EA) is a worldwide publisher, developer, and distributor of entertainment software for computer, console, handheld, and mobile platforms. Headquartered in Redwood City, California, EA's total net revenue for the fiscal year ending in 2009 was a reported 4.2 billion dollars. As of March 31, 2009, the publicly traded company employs 9,500 full-time staff, more than half of which resides outside of the U.S. Electronic Arts is organized under three distinct labels: EA Games, EA Sports, and EA Play. Each label has dedicated game development and marketing teams, and each operates on an international scale. Strategic planning, distribution, sales, and localization fall under the company's Global Publishing unit, which also oversees its mobile and Pogo online businesses.

Initially named Amazin' Software, the company was founded on May 28, 1982 by 28-year-old William "Trip" Hawkins III, who previously served as Apple Computer's director of product marketing. Business focused on publishing and distributing software across multiple computer platforms. Electronic Arts emphasized the independent talent behind games, signing them to contracts modeled after those in other entertainment industries. Software designers were prominently featured on flat, eye-catching packaging inspired by record albums, which included the following mission statement: "We are an association of electronic artists who share a common goal. We want to fulfill the potential of personal computing." Notable titles during the company's formative years included Archon, M.U.L.E., The Seven Cities of Gold, Skyfox, and Dr. J and Larry Bird Go One on One. Within its first four years of operation, EA became the industry's leading supplier of entertainment software. To further fund its expansion, the company went public in 1989.

After cautiously waiting out the 8-bit console era dominated by the Nintendo Entertainment System, EA finally entered the market in 1990. While the company adapted some of its titles to the NES, video game development primarily focused on Sega's 16-bit Genesis. This decision proved to be a boon to both companies. A number of important console franchises were created on Genesis, particularly in the sports genre. These included the debuts of John Madden Football, PGA Tour Golf, NHL Hockey, and NBA Live. The popularity of these sports games led to a new brand entitled EASN (Electronic Arts Sports Network), which was later renamed EA Sports due to potential trademark infringement between EASN and cable sports channel ESPN. A settlement had EA agreeing to change its brand's name, while ESPN allowed EA free airtime on the network, increasing the company's exposure to a sports-hungry audience. The tagline for the new brand highlighted each title's purported attention to detail: "EA Sports. If it's in the game, it's in the game."

As revenues increased each year in large part due to the popularity of home consoles, Electronic Arts continued to expand and grow internationally. After Trip Hawkins resigned in May 1991 to focus his attention on a new company he founded, The 3DO Company, former vice president of marketing Larry Probst III became CEO and began aggressively pursuing other companies. Throughout the 1990s, the company made a number of significant business acquisitions to diversify its ever-growing software portfolio. From 1991 to 1998, EA purchased Distinctive Software (which became EA Canada), Origin Systems (Ultima, Wing Commander), Bullfrog Ltd. (Theme Park, Magic Carpet), Maxis (SimCity), and Westwood Studios (Command & Conquer), companies with proven track records in developing best-selling, critically acclaimed games. Maxis would later strike gold for EA in Will Wright's The Sims, a whimsical virtual life simulation driven by user-created content. The Sims and its spin-offs would become one of the best-selling computer franchises in history.

Continued acquisitions and exclusive licenses would fuel the next decade. Criterion, best known for the Burnout series, a competitor to the company's own Need for Speed franchise, was purchased in 2004, along with developer NuFX (NFL Street). Driven by the success competitor Take-Two enjoyed with ESPN NFL 2K5, EA lobbied for and signed an exclusive contract with the NFL and NFLPA for a reported 400 million dollars. The five-year deal, which began in 2005, prevented any other company from using active players, stadiums, team names, and logos from the NFL. Adding insult to injury, EA then acquired the ESPN license in a 15-year deal, which would begin in 2006, for 800 million. These moves were the impetus for Take-Two engineering an exclusive deal of its own in 2005, purchasing the sole third-party rights to Major League Baseball for seven years. At stake was a sports game market worth an estimated 1.2 billion dollars in 2004 alone, according to NPD Group data.

In February 2006, EA turned its attention to the growing mobile market by acquiring Jamdat Mobile, Inc. One month later the company decided to purchase Mythic Entertainment, makers of Dark Age of Camelot and Warhammer Online. The publisher later acquired Digital Illusions CE, creators of the Battlefield series, in October 2006. To expand its casual games portfolio, EA announced in August 2007 a six-year licensing deal with Hasbro to publish games based on such properties as Monopoly, Scrabble, Nerf, Tonka, and Littlest Pet Shop. In October, EA spent nearly 800 million to purchase VG Holdings, owner of developers Pandemic Studios (Star Wars: Battlefront) and BioWare Corp. (Baldur's Gate, Mass Effect).

Despite these acquisitions, Activision's surprise announcement that it was merging with Vivendi Games in December 2007 meant that Electronic Arts was no longer the world's largest publisher of interactive entertainment. In March 2008, EA attempted to reclaim the title by acquiring Take-Two Interactive for two billion dollars in cash. The offer, announced before the April launch of Grand Theft Auto IV, was rejected by Take-Two's board of directors, stating that EA "undervalued" the company. Closing out the year, EA strengthened its international presence by purchasing Korean online game developer J2MSoft Inc.

During a conference call to investors on May 5, 2009, CEO John Ritticiello outlined a strategy to increase promotion and marketing, aggressively support the Wii platform with custom-tailored titles, and build on the company's digital services revenue in the U.S. and abroad. The latter is what Ritticiello believes "will define our leadership in the years ahead." Plans for this part of 2009's business involved releasing 30 games on the iPhone, doubling the number of complete game downloads and micro-transactions from 2008, introducing two new online subscription services, and laying the foundation for profitability in the Asian market through such titles as FIFA Online 2 and NBA Street Online.

~ Scott Alan Marriott, All Game Guide

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